Question

Kindzi Co. has preferred stock outstanding that is expected to pay an annual dividend of $4.67 every year in perpetuity. If the required return is 4.54 percent, what is the current stock price

Answer 1

Kindzi Co. has preferred stock outstanding that is expected to pay an annual dividend of $4.67 every year in perpetuity. If the required return is 4.54 percent- The current stock price is $102.86

Explanation:

From the question the below mentioned information is given

Annual Dividend = $4.67

The required return =$4.54%=$0.0454

Let assume the current stock price be x

Current stock price= Annual Dividend/return required

x=$4.67/$0.0454=102.86

Therefore the current stock price is $102.86

Kindzi Co. has preferred stock outstanding that is expected to pay an annual dividend of $4.67 every year in perpetuity. If the required return is 4.54 percent- The current stock price is $102.86